People are aware of this, and purposely choose products that are 80% as good for 20% of the cost. Other people shop at Whole Foods and Apple. None of them is ripping you off. They all provide options that you knowingly and willfully choose over your other options.
> And if Target/Amazon/Dollar General weren’t around, there’s no reason they wouldn’t increase prices and pad their margins.
The comparison to landlords being that if one of them had a monopoly on local housing they could charge really high prices. But that seems pretty fantastical considering that a local housing monopoly hasn't happened basically anywhere and would presumably yield antitrust scrutiny besides.
> In a landlord situation, their cost of goods is so small that they can afford to sit on an empty apartment while prospective renters need to put a roof over their family or business.
The cost of goods is the cost to buy housing (and the opportunity cost of the interest you could have had on that money), plus that of maintaining the property. If that is so cheap then why is anybody renting?
I'm not a landlord, but I did consider getting into it once, and studied how the system works. And a number of my friends are landlords (including one who quit his job because the passive income is enough).
No - probably over 95% of landlords do no have a small cost. Almost everyone is paying a mortgage/loan on that property. The exceptions are old people whose house was paid off and they just want free money. Those people almost always charge low rent, BTW - they just want some extra cash. The standard tactic is to buy properties on a loan, and try to get $100-200/month profit per house/unit. So if the apartment costs $1500/month in rent, assume their monthly cost to the bank (principle + interest) is about $700-800. Then add in the insurance and real estate fees. The remaining money goes to long term costs (repairs, vacancy, etc). Then they keep about $100-200.
If the apartment sits empty, they're still on the hook for close to $1000/month in taxes, insurance and loan payments.
Over time, if the property appreciates significantly, the plan is to sell the property, and use the gain in appreciation to buy a larger apartment complex, where they are down to $100-200/month again, but because the place has, say, double the number of apartments, their overall gain is double. Lather, rinse, and repeat. They only stop once they are making enough to live on in the lifestyle they want - which could be anywhere from 30-60 units.
They are almost always in debt, and vacancies are almost always very expensive.
A lot of the anti-landlord comments are similar to anti-employer comments, where it's always a given that employers have large piles of money and they can afford X, whether X is higher wages, better equipment, etc. Once you step into the "other" role, you'll find your assumptions were wrong.
Of course, if the state/city needs to pass laws to help with housing, so be it. Let's not just blindly assume that most landlords can absorb it.
In a landlord situation, their cost of goods is so small that they can afford to sit on an empty apartment while prospective renters need to put a roof over their family or business.